The Washington PostDemocracy Dies in Darkness

Old debt ceiling fights had a purpose. This one doesn’t.

The whole standoff is about which party has to vote for the increase, not about policy

A standoff is ongoing at the Capitol over how to raise the limit on how much debt the U.S. government can borrow. But this time, the fight is mostly just over which party has to vote to allow the increase.
A standoff is ongoing at the Capitol over how to raise the limit on how much debt the U.S. government can borrow. But this time, the fight is mostly just over which party has to vote to allow the increase. (Stefani Reynolds/For The Washington Post)
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Washington is in the middle of the biggest debt limit showdown in a decade. But today’s debate is very different than those of years past, with potentially more disastrous consequences. Previous fights about raising the debt limit typically involved negotiations over how best to reduce the deficit going forward. This time, there’s no negotiation at all, just a standoff over who has responsibility for voting for the increase.

Raising the statutory debt limit has never been a politically popular vote. That’s why, from the mid-1980s to 2011, the act of increasing the limit frequently forced presidents of both parties and their counterparts in Congress to address our nation’s fiscal condition — something that should be done more regularly. Lawmakers wanted to show constituents that they were taking fiscal matters seriously, so hitting the debt limit and needing to raise it prompted consideration of why the U.S. government had to borrow so much money in the first place. Republicans and Democrats alike would agree to vote to raise the debt ceiling in exchange for policy compromises such as spending cuts.

Many of my fellow politicians won’t tell voters the truth. The result was Jan. 6.

These debates produced the omnibus budget reconciliation bills of the 1980s, statutory “pay as you go” rules in the early 1990s and the Balanced Budget Act of the Clinton era. Sometimes, they also led to high-stakes drama, including in 2011, when we narrowly avoided defaulting on our debt by passing the bipartisan Budget Control Act, which both raised the debt ceiling and enacted new spending controls.

None of those budget agreements fully reversed our growing deficits, as evidenced by the national debt’s rise from $2 trillion in the mid-1980s (the equivalent of $5 trillion now, accounting for inflation) to $28 trillion today.

But the agreements did have an impact. The debt-limit-provoked budget deals of the 1990s led to surpluses from 1998 to 2001. And while much of the Budget Control Act — notably the automatic cuts in discretionary spending — was undone in subsequent years, the law still produced $1 trillion in discretionary and mandatory savings compared with prior projections by the Congressional Budget Office.

At the time, the 2011 fight looked like it could end in disaster. But there were talks going on all along. In the months leading up to the enactment of the Budget Control Act, I was part of a small group, led by then-Vice President Joe Biden, of congressional leaders and senior administration officials who met multiple times a week to find common ground on reducing our deficit. We debated Medicare reimbursement rates, food stamp eligibility, military and federal employee retirement, fees for government services, and dozens of other issues.

Certainly, there were plenty of areas where we disagreed, and Republicans and Democrats had their red lines: For me and my fellow Republicans, it was opposing tax increases; for the Democrats, it was preventing cuts to the Affordable Care Act. But we also found areas of agreement that helped us avoid default and formed the basis of future bipartisan fiscal legislation.

Today, as in 2011, there is a growing concern that the federal government might for the first time in history default on its obligations. Economists are again warning about the dire economic consequences of a default, including millions of jobs lost, trillions of dollars in wealth destroyed and soaring borrowing costs.

Republicans don’t want to vote to raise the debt ceiling just as Democrats try to muscle through a $3.5 trillion tax and spending package on a party-line vote. Democrats don’t want to have to be the only ones to vote to raise the limit, since many of the policies that contributed to the run-up in debt in the first place were supported by Republicans as well as Democrats.

While both positions are understandable and, in many ways, defensible, this fundamental transformation of the debate around the debt limit will make it increasingly difficult to avoid default in the future.

Debates around fiscal policy lend themselves to compromise, like what occurred in the 1980s, 1990s and 2011. In that last crisis, even though pundits accused my colleagues and me of acting irresponsibly by forcing the debate, the nation avoided default, and we improved the country’s fiscal position.

With $5 trillion in the federal budget, even today’s polarized Washington could still find common ground on fiscal matters — as evidenced by the way a bipartisan group in the Senate negotiated how to pay for the $1.2 trillion infrastructure package Congress is considering now.

But a debate over who bears responsibility for voting to raise the debt limit doesn’t allow for compromise.

Thanks to the budget reconciliation process that allows legislation to pass with only 51 votes in the Senate, I suspect we will get through this debt limit crisis. But Congress will probably have to raise the limit again in 2023. What happens if Republicans win control of the House and/or the Senate in next year’s midterm elections? It is reasonable to expect that Democrats will invoke the same standard that Republicans are using today: You are in charge, you own it.

The parties are locked in a political arms race — and keep finding new weapons

Republican base politics made it virtually impossible for GOP members to pass a debt limit increase on their own — and certainly not one that President Biden, responding to progressive forces in the Democratic Party, would be willing to sign into law.

The best path forward is for Congress to return to combining debt limit increases with bipartisan debates around spending and revenue. But in a world in which neither political party seems particularly concerned about deficits, it may be time to consider the second-best way forward: replacing the debt limit with a fiscal control mechanism whose consequences would be less devastating than default if Congress failed to act.

There are several good ideas for solving some of our fiscal quandaries, including bipartisan proposals like the Trust Act, which would create “rescue committees” to shore up programs such as Social Security, Medicare and disability insurance. The idea traces its roots to the bipartisan committee that saved Social Security in 1983 through a compromise involving benefits and revenue.

Whether we return to the debates of the past or establish a new process, it is critical that we find a way to address our fiscal problems while avoiding a purely political argument over the debt limit, one that threatens to ruin our economy through the self-inflicted wound of defaulting on our debt.

Twitter: @EricCantor

Read more from Outlook:

Political partisanship is vicious. That’s because political parties are too weak.

The debt limit fight is a scam. The GOP counts on voters not knowing that.

The left should resist the siren song of ‘modern monetary theory’

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